The Elizabeth Warren issue and why we should care
On the surface, this really does not look like an issue Black folk or Latinos should be bothered with. Another Harvard candidate for an Obama administration job, and one that is not even at the Supreme Court, or Cabinet level just does not raise the ire or the emotional heat for many of those still looking for new employment, mortgage deliverance and/or courtroom leniency.
This is a Wall Street thing, isn’t it?
President Obama got his major financial reform package through Congress a few weeks ago and has signed it. It is operational history now. At the same time, concern is high about GM—the over-the-cliff auto giant last year who is just reporting big profits these few months later—and how many of the big and medium sized banks are cash fat now, and additionally how big business seems to be earning and hoarding a lot of money without re-hiring a ton of laid-off workers.
Now that’s an issue many of us are ready to have a dust-up over. Corporate greed cannot be back in the driver’s seat so soon, while at the same time California is still threatening to hand out I.O.U.s, and teachers, firemen and police are being canned in so many municipalities.
That’s the standard problem with political obviousness: It’s rarely what it merely seems to be.
Elizabeth Warren, J.D., is the rather plain-looking (although make-up artists are now on the case), plain-speaking, tough-as-nails regulator who made Timothy Geithner, the Treasury Secretary, sweat in public grilling before Congress. She also has not minced words in describing how we got into this economic mess, who’s at fault, and what we need to do to get out of it. No, she’s is not an elected official. She was appointed to head the Congressional oversight panel to monitor and report on the utilization of the Troubled Asset Recovery Program (TARP) funds.
By the way, the federal government has made money from TARP because many of those corporate and bank loans have already been re-paid, with interest. This comes partially because there has been intense and relentless scrutiny by Professor Warren’s panel. Consequently the TARP program has actually become a billion-dollar windfall for American taxpayers.
Now, however, after making her bones speaking financial truth to banks and other financial institutions, and being in line to run the entity she suggested and designed—the Bureau of Consumer Financial Protection, which got lost, then found and then kept in the new federal Financial Reform Act—the good professor is being told that it’s time for her to mosey on back to the ivory tower and instruct some students.
So many talking heads now say, the President needs another banking and corporate insider to head that new Commission of Consumer Advocacy and Protection (COP). After all, the banks and the chambers of commerce are still miffed at the president about the financial reform legislation, and Obama can’t really afford to make the money tree folks enemies because of and for the up-coming elections and other activities. Thus, the president needs a Timothy Geithner clone to head this new Consumer Protection Agency.
Life and politics often present brief moments of clarity and grit to test what one is made of. For the Obama administration, this is one of those game-changing moments. The good professor has not eased down the beltway back towards Massachusetts. Instead, she, and a legion of supporters (there have already been rallies, phone calls, blogs—a full campaign) have decided that she wants the job she helped to create; that she is the one best qualified right now to inaugurate that position. This will show the jaundiced American public that there are still real good guys and gals working for the government, who do have our backs. Elizabeth Warren is up for the fight. The question is, is the president?
And fight there will be. Many congresspersons, and a large percentage of the banking industry, see Elizabeth Warren as the second coming of regulatory hell. She seems unafraid, unbossed and unbought. She appears to be exactly what she is: An eagle-eyed penny pincher making sure the credit card companies, bankers, loan and mortgage folk and others in the financial industry do exactly what they are supposed to do. This includes ending their general tendency to rip us off. As far as the eye can tell, Elizabeth Warren is the real consumer advocate deal.
A lot of the progressive base of support that elected President Obama want Elizabeth Warren as the new sheriff of financial regulation. To them, this is gut-check time for the president. They want him to throw down the gauntlet, announce it is Professor Warren he wants, and fight it out for the Senate confirmation votes until he wins. This a character marker moment, for many progressives, when the president either shows the stones they know he has or capitulates to the corporate greed culture that intensely dislikes Elizabeth Warren and the main streeters.
Fight and win this one for the little people, the progressives say. And if the Senate acts too froggy, Mr. President, then simply make your first four-month recess appointment of a federal official and get her on the job. The opposition will quit. Fight your own party if you must, fight the good-ole-boys network, fight your own advisers, but stare this nabob of negativity in the face and do this thing.
Otherwise, the political cost will be very high, they say, and incidentally are right about. This cost will include too many people losing complete faith in that new 2,000-page financial reform legislation. This one act, or non-act—appointing her or not appointing her—will characterize Mr. Obama’s presidency as a people’s champion or not.
Hmmm. Financial regulators aren’t supposed to be that important, but this one is, for all of us.
This is the change sign many have been looking for.
Prediction: It has taken a long time to make this appointment. The announcement about our new Supreme Court Justice came faster than this one. But within the next few days, President Obama will publicly announce the appointment of Professor Elizabeth Warren as our new consumer protection commissioner. Anyone want to bet?
David Horne, Ph.D., is a tenured professor at California State University Northridge.
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